8 Five Major Categories of Ratios  Liquidity: Can we make required payments as they fall due?  Asset management: Do we have the right amount of assets for the level of sales? (More…)

9 Ratio Categories (Continued)  Debt management: Do we have the right mix of debt and equity?  Profitability: Do sales prices exceed unit costs, and are sales high enough as reflected in PM, ROE, and ROA?  Market value: Do investors like what they see as reflected in P/E and M/B ratios?

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